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Strategic

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With the video game industry being the fastest growing sector of the growing entertainment industry, the industry's revenue has now reached $26 billion in annual revenue and there is currently no indication of decline in the industry. So, in order to identify how the revenue is distributed, it's essential to look at the supply chain of the entire PS3 business. As seen in the supply chain, there are opportunities in many aspects of the console business, coming from the actual console sales as well as extras such as games.

The customers, as identified by our segmentation analysis table, are at the end of the supply chain, and their consuming of video games are distributes across several actors.

Additionally, the most known among the …show more content…

5.3 Business Models

There are several business models contributing to the revenue income for the PS3. Obviously, sales of the actual console initially generate the biggest revenue. But, as reported by several news agencies, Sony actually makes a loss on each console bought by a consumer. [26] As reported by several sources, a PS3 costs between $725 and $905 to manufacture, but is sold for $599 in the US market. The reason for the high manufacturing price is the high cost of components such as the Blu-Ray DVD, XDR memory etc. (More on that chapter 8).

To support several streams of revenue there are three business models for distribution supported by the PS3. Since the console is making a loss per sold unit, there are other ways for Sony to catch up on the income and make a profit in the console business through other business models. The business models are:

However, comparing the business models for the PS3 tells us that there are several possible models for generating revenue and profit for the console. Most notably, the Internet Gaming via the PlayStation network and the developer licenses are possible sources of potential profit.
6 Marketing Strategy

The Playstation 3 has a broad marketing strategy set by Sony. Launched with slogans such as "This is living" and "Play beyond", Playstation 3 is aiming for a large audience.

Thereby, Sony will have to apply a different marketing

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